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Impact of Strategy, Human Resource Management, Budgeting and Participation on Return on Assets

JOHN PARKINSON (SCHOOL OF ADMINISTRATIVE STUDIES, ATKINSON FACULTY OF LIBERAL & PROFESSIONAL STUDIES, YORK UNIVERSITY, TORONTO, ONTARIO, CANADA)
SIMON TAGGAR (SCHOOL OF ADMINISTRATIVE STUDIES, ATKINSON FACULTY OF LIBERAL & PROFESSIONAL STUDIES, YORK UNIVERSITY, TORONTO, ONTARIO, CANADA)

Journal of Human Resource Costing & Accounting

ISSN: 1401-338X

Article publication date: 1 February 2000

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Abstract

This study looked at the impact on return‐on‐assets (ROA) of aligning budgeting and human resource management (HRM) practices with strategy. A Lisrel model was tested on 79 large Canadian and U.S. firms. Although HR policy alignment was positively associated with ROA, budgetary alignment was only positively associated with ROA in conjunction with process participation. That is, organisations performed best when the budgets were aligned with the mission of the organisation and numerous levels of the organisation had the opportunity to participate in strategy formation. Furthermore, aligned budgets did not ameliorate the negative affects of implementing a non‐participatory process of strategy formation.

Citation

PARKINSON, J. and TAGGAR, S. (2000), "Impact of Strategy, Human Resource Management, Budgeting and Participation on Return on Assets", Journal of Human Resource Costing & Accounting, Vol. 5 No. 2, pp. 45-61. https://doi.org/10.1108/eb029068

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MCB UP Ltd

Copyright © 2000, MCB UP Limited